Logistics costs
account for around 6-10 percent of average retail prices in India as against the global
average of 4-5 percent. Therefore, there is a clear scope to improve margins by 3-5 percent
by improving the efficiency of the supply chain and logistics processes. Developing an
integrated supply chain, including cold chain can save up to `300 billion annually and at the
same time reduce the wastage of perishable horticulture produce. It is worth noting that the
price of vegetables, fruits, milks and eggs, meat and fish have been rising faster in spite of the
fact that India is the second highest producer of fruits and vegetables. This is led by
inadequate supply chain and logistics infrastructure and management.